limited companies Flashcards
What is an LTD
A private limited company which cannot publicly advertise its shares for sale and is owned by family and friends
Give some advantages for LTD’s
the owners have limited liability
it can improve the status of the business
any new shareholders have to be invited, which protects the business from outside influence
if the founder dies, the company still exists and is controlled by the shareholders
Profits are only shared between shareholders. They receive this as a dividend.
Give some disadvantages for LTD’s
there is often more paperwork
in some instances, other people are able to view the business’ financial information
it can be very time consuming to set up
the business may require outside professional help to manage its finances
Because profits are only shared with shareholders it is harder to motivate and control workers who do not hold shares
